Chapter 8

CHAPTER
Building a Powerful Marketing Plan
Copyright 2011 Pearson Education, Inc. Publishing as as Prentice Hall Copyright 2011 Pearson Education, Inc. Publishing Prentice Hall
Building a Guerrilla Marketing Plan

n
Marketing
The process of creating and delivering desired goods and services to customers. n Involves all of the activities associated with winning and retaining loyal customers.
n
National Federation of Independent Business Study

n
55% of small business owners say they do not need marketing because their products and services sell
Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
8-2
Building a Guerrilla Marketing Plan
Guerrilla marketing strategies:

Are unconventional, low-cost, and creative marketing techniques that allow a small company to realize a greater return from its marketing investment than do larger rivals. n Do not require large amounts of money to be effective just creativity.
n
8-3
A Guerrilla Marketing Plan

1. Pinpoints the specific target markets the company will serve. 2. Determines customer needs and wants through market research. 3. Analyzes a firms competitive advantages and creates a marketing strategy to build a competitive edge. 4. Helps to create a marketing mix that meets customer needs and wants.
8-4
Pinpointing the Target Market

n
One objective of market research: Pinpoint the company's target market, the specific group of customers at whom the company aims its products or services. Marketing strategy must be built on clear definition of a companys target customers. Examples: Great Call and Lexus of Palm Beach
8-5
Pinpointing the Target Market

n
Target customer must permeate the entire business merchandise sold, background music, layout, dcor, and other features. Without a clear image of its target market, a small company tries to reach almost everyone and ends up appealing to few.
8-6
Market Research
n
n n
Market research is the vehicle for gathering the information that serves as the foundation for the marketing plan. Never assume that a market exists for your companys product or service; prove it! Market research does not have to be time consuming, complex, or expensive to be useful.
n
Web-based market research online surveys Trend-tracking

8-7
Tracking Trends
n n n n n n n
Read many diverse current publications Monitor blogs and newsgroups Watch the top 10 TV shows See the top 10 movies Talk to at least 150 customers a year Talk with the 10 smartest people you know Listen to your children and their friends
8-8
Market Research
How to Conduct Market Research: 1. Define the objective. 2. Collect the data.
Individualized (one-to-one) marketing
8-9
How to Become an Effective One-to-One Marketer

Identify your best customers, never passing up the opportunity to get their names. Enhance your products and services by giving customers information about them and how to use them.
Collect information on these customers, linking their identities to their transactions.
Successful One-to-One Mar keting

Calculate the long-term value of customers so you know which ones are most desirable (and most profitable). Know what your customers buying cycle is and time your marketing efforts to coincide with it - just-in-time marketing.
See customer complaints for what they are - a chance to improve your service and quality. Encourage complaints and then fix them!
Make sure your companys product and service quality will astonish your customers.
Source: Adapted from Susan Greco, The Road to One-to-One Marketing, Inc., October 1995, pp. 56-66.
8 - 10
Market Research
(continued)
How to Conduct Market Research: 1. Define the problem. 2. Collect the data.
nIndividualized (one-to-one)
marketing nData mining
3. Analyze and interpret the data. 4. Draw conclusions and act.

n
8 - 11
(Customer Relationship Management)

In addition to the text
Relationship Marketing
Involves developing and maintaining long-term relationships with customers so that they will keep coming back to make repeat purchases.
8 - 12
(Customer Relationship Management)

Relationship Marketing
Steps:
Collect meaningful customer information and compile it in a database. n Mine the database to identify best customers. n Use the information to develop lasting relationships with best customers. n Attract more customers who fit the best customer profile.
n
8 - 13
The Relationship Marketing Process

If you have done everything else correctly, this step is relatively easy. Superb customer service is the best way to retain your most valuable customers.
Sell, Service, & Satisfy
Analy ze
Conduct detailed customer intelligence to pinpoint most valuable customers and to learn all you can about them, including their lifetime value (LTV) to the company.
Build Relations hips

Based on what you have learned, contact customers with an offer designed for them. Make customers feel special and valued.
Connec t & Collect Learn

Make contact with most valuable customers and begin building a customer database using data mining and data warehousing techniques.
Learn from your customers by encouraging feedback from them; develop a thorough customer profile and constantly refine it.

8 - 14
Steps in CRM In addition to the text

n n
n n
Collect meaningful information on existing customers and compile it in a database. Mine the database to identify the companys best and most profitable customers and their buying habits. Use the information to establish lasting relationships with these customers. Attract more customers who fit the profile of the companys best customers.
8 - 15
Four Levels of Customer Sensitivity

Level 4: Customer Partnership
Level 3: Customer Alignment
Level 2: Customer Sensitivity
Level 1: Customer Awareness

8 - 16
Guerrilla Marketing Principles

n n n
Find a niche and fill it. Use the power of publicity Dont just sell; entertain!
n
Entertailing
Strive to be unique.
8 - 17

(continued)
Connect with customers on an emotional level.

n n
Build trust Define a unique selling proposition (USP)
8 - 18
Unique Selling Proposition

n
n n n
A key customer benefit of a product or service that sets it apart from its competition. Answers key customer question: Whats in it for me? Consider intangible or psychological benefits as well as tangible ones. Communicate your USP to your customers often.
P S U
8 - 19
FIGURE 8.1 The Connection between Branding and a USP Source: Based on Brandsavvy, Highlands Ranch, Colorado
8 - 20

(continued)
Create an identity for your business through branding.
8 - 21
Building a Brand
High
Antes
Features that are important to customers but all competitors provide them Every company in the market must ante up on these features.
Drivers
Features that are both important to customers and are highly differentiated from those of competitors These are the attributes on which a company must focus to build its brand.1
Relevance
Neutrals
Features that are irrelevant to customers These features are useless when it comes to branding.
Fools Gold
Features that are unique to your company but do not drive customers loyalty to your product and services Dont make the mistake of trying to build a brand on these features!
Low Low
Differentiation
High
8 - 22
Source: Adapted from What Really Matters in Building a Brand, The McKinsey Quarterly, May 2004, www.mckinseyquarterly.com/newsletters/chartfocus/2004_05.htm

(continued)
nCreate
an identity for your business through branding. nEmbrace social networking.
8 - 23
Social Networking
n
n n
Social networks sites, such as Facebook and MySpace, allow entrepreneurs to connect with potential and existing customers at little or no cost. More than half of Facebook users are over the age of 25. These sites now offer business survey tools and advertising functions for promotional purposes.
8 - 24

(continued)
nCreate
an identity for your business through branding. nEmbrace social networking. nStart a blog.
n
8 - 25
Blogging
n n n
An estimated 113 million blogs exist with 5,000 of them from businesses. Economical and effective online communication. Blog Guidelines:
Be honest, balanced, and interesting. n Post blog entries consistently so that readers have a reason to return. n Ask customers for feedback.
n
8 - 26
Blogging
(continued)
Strive to cultivate the image of an expert or a trusted friend on a topic that is important. n Use services such as Google Alerts that scan the Web for a companys name and send e-mail alerts when they find posts. n Promote the blog via e-mail and promotional Web Sites.
n
8 - 27

(continued)
nCreate
an identity for your business through branding. nEmbrace social networking. nStart a blog. nCreate online videos.
8 - 28
Online Videos
n n
Study: 19% of Internet users watch online videos every day. Online video guidelines:
Think edutainment. n Be funny. n Connect with current events. n Involve customers. n Keep it short.
n
8 - 29

(continued)
nCreate
an identity for your business through branding. nEmbrace social networking. nStart a blog. nCreate online videos. nFocus on the customer.
n
8 - 30
Focus on the Customer

Only 6% of customers who experience a problem contact the company to complain.
n n n
31% tell family members, friends, and colleagues about their negative experience. 6% of those people tell their horror stories to six or more people. For every 100% of customers who have negative experiences with a business, the company stands to lose 32 to 36 current customers or potential customers.
8 - 31

(continued)
Because 20% of a typical companys customers account for about 80% of its sales, no business can afford to alienate its best and most profitable customers and survive! Research shows that repeat customers spend 67% more than new customers. Attracting new customers costs the typical business seven to nine times as much as keeping existing customers.
8 - 32
Principles of Customer Experience Management (CEM)

Every customer interaction should be:

Intimate Intimate Personal Personal Consistent, courteous, and professional Consistent, courteous, and professional Responsive Responsive Helpful information and advice Helpful information and advice Involvement of caring, well-trained people Involvement of caring, well-trained people Long-term relationship view Long-term relationship view Emphasis on sustaining an ongoing Emphasis on sustaining an ongoing relationship relationship Nurturing the company/customer relationship Nurturing the company/customer relationship
(and profitable) (and profitable)
Satisfied, Satisfied, loyal, loyal, repeat repeat
customers customers
Source: Adapted from Wake-Up Call: To Fix CRM, Fix the Customer Experience Now!, BearingPoint White Paper ( www.bearingpoint.com, Fall 2005, p. 5.
8 - 33

(continued)
Companies that are successful at retaining their customers constantly ask themselves (and their customers) four questions: 1. What are we doing right? 2. How can we do that even better? 3. What have we done wrong? 4. What can we do in the future?
8 - 34

(continued)
nCreate
an identity for your business through branding. nEmbrace social networking. nStart a blog. nCreate online videos. nFocus on the customer. nBe devoted to quality.
8 - 35
Devotion to Quality
n
Study: 60% of customers who change suppliers do so because of problems with a companys products or services. World-class companies treat quality as a strategic objective, an integral part of company culture. The philosophy of Total Quality Management (TQM):
n n n
Quality in the product or service itself. Quality in every aspect of the business and its relationship with the customer. Continuous improvement in quality.
8 - 36
How Do Americans Define Quality in a Product?

n
Reliability (average time between breakdowns) Durability (how long an item lasts) Ease of use Known or trusted brand name Low price
n n n n
8 - 37
How Do Americans Define Quality in a Service?

n n n n
Tangibles - equipment, facilities, people Reliability - doing what you say you will do Responsiveness - promptness in helping customers Assurance and empathy conveying a caring attitude
8 - 38

(continued)
nCreate
an identity for your business through branding. nEmbrace social networking. nStart a blog. nCreate online videos. nFocus on the customer. nBe devoted to quality. nPay attention to convenience.
8 - 39
Attention to Convenience
The average U.S. work week is 42.5 hours, an increase from 37.5 hours in 2003. n Is your business conveniently located near customers? n Are your business hours suitable to your customers? n Would customers appreciate pickup and delivery services? n Do you make it easy for customers to buy on credit or with credit cards?
8 - 40
Attention to Convenience
(continued)
n n n n
Are your employees trained to handle business transactions quickly, efficiently, and politely? Does your company offer extras that would make customers easier? Can you bundle existing products to make it easier for customers to use them? Can you adapt existing products to make them more convenient for customers? Does your company handle telephone calls quickly and efficiently?
8 - 41

(continued)
Concentrate on innovation.
8 - 42
Concentration on Innovation
n
Innovation
The key to future success. n One of the greatest strengths of entrepreneurs. It shows up in the new products, techniques, and unusual approaches they introduce. Entrepreneurs often create new products and services by focusing their efforts on one area and by using their size and flexibility to their advantage.
n
8 - 43

(continued)
nConcentrate
on innovation. nBe dedicated to service and customer satisfaction.

nSurvey:
25% of customers have walked out of a store within the past year because of poor service. nSurvey: 80% say they will never return to a business after a negative customer service experience.
8 - 44
Dedication to Service
Goal: To achieve customer astonishment!
n n n n n n
Listen to customers. Define superior service. Set standards and measure performance. Examine your companys service cycle. Hire the right employees. Train employees to deliver superior service.
8 - 45
(continued)

n
Empower employees to offer superior service. Treat employees with respect and show them how valuable they are. Use technology to provide improved service.
8 - 46
(continued)

n
Use mystery shoppers to measure customer service Reward superior service. Get top managers support. View customer service as an investment, not an expense.
n n n
8 - 47

(continued)
n n
Concentrate on innovation. Be dedicated to service and customer satisfaction. Emphasize speed.
8 - 48
Emphasis on Speed
n
Use principles of time compression management (TCM):

n n
Speed new products to market Shorten customer response time in manufacturing and delivery Reduce the administrative time required to fill an order.
Study: Most businesses waste 85 to 99% of the time required to produce products or services!
8 - 49
Emphasis on Speed
(continued)
n n
Re-engineer the process rather than try to do the same thing - only faster. Create cross-functional teams of workers and empower them to attack and solve problems. Set aggressive goals for production and stick to the schedule.
8 - 50
Emphasis on Speed
(continued)
n n n
Rethink the supply chain. Instill speed in the company culture. Use technology to find shortcuts wherever possible. Put the Internet to work for you.
8 - 51
The Marketing Mix
Product Place Price
Promotion
8 - 52
FIGURE 8.2 Five Characteristics of a Great Product

8 - 53
The Product Life Cycle
FIGURE 8.3
The Product Life Cycle
8 - 54
Stages in the Product Life Cycle

n
Introductory stage
High Costs
8 - 55

(continued)
n n
Introductory stage Growth and acceptance stage
High Costs
High Sales Costs Climb
8 - 56

(continued)
n n n
Introductory stage Growth and acceptance stage Maturity and competition stage
High Costs
Sales Climb
Profits Peak
8 - 57

(continued)
n n n n
Introductory stage Growth and acceptance stage Maturity and competition stage Market saturation stage
High High Costs Costs
Sales Sales Climb Climb
Profits Profits Peak Peak
Sales Sales Peak Peak
8 - 58

(continued)
n n n n n
Introductory stage Growth and acceptance stage Maturity and competition stage Market saturation stage Product decline stage
High High High Costs Costs Costs
Sales Sales Climb Climb
Profits Profits Profits Peak Peak Peak
Sale Sales Sales s Peak Peak Peak
Sales & Profits Fall
8 - 59
FIGURE 8.4 Time between Introduction of Products
8 - 60
Place: Channels of Distribution Consumer Goods

Manufacturer Consumer
Manufacturer
Retailer
Consumer
Manufacturer
Wholesaler
Retailer
Consumer
Manufacturer
Wholesaler
Wholesaler
Retailer
Consumer
8 - 61
Place: Channels of Distribution Industrial Goods

Manufacturer Industrial User
Manufacturer
Wholesaler
Industrial User
8 - 62
Price
A key factor in the decision to buy Focus attention on non-price competition
Free trial offers Free delivery Lengthy warranties Money back guarantees
8 - 63
Promotion
n n
Goal: To inform and persuade. Through advertising and other communication techniques. Create an image. Marketing is not a battle of products; it is a battle of perceptions.
n n
8 - 64
Conclusion
n
n n
A guerrilla marketing plan offers the entrepreneur significant benefits. Target marketing is key. Create a competitive and edge through customer focus, quality, convenience, innovation, service and speed.
8 - 65

Chapter 8

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Chapter 8

Uploaded by

Copyright:

Available Formats

CHAPTER

Building a Powerful Marketing Plan

Building a Guerrilla Marketing Plan

National Federation of Independent Business Study

Building a Guerrilla Marketing Plan

Guerrilla marketing strategies:

A Guerrilla Marketing Plan

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Pinpointing the Target Market

Pinpointing the Target Market

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Web-based market research online surveys Trend-tracking

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Individualized (one-to-one) marketing

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

How to Become an Effective One-to-One Marketer

Collect information on these customers, linking their identities to their transactions.

Successful One-to-One Mar keting

marketing nData mining

3. Analyze and interpret the data. 4. Draw conclusions and act.

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

(Customer Relationship Management)

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

(Customer Relationship Management)

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

The Relationship Marketing Process

Sell, Service, & Satisfy

Build Relations hips

Connec t & Collect Learn

In addition to the text

Steps in CRM In addition to the text

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Four Levels of Customer Sensitivity

Level 4: Customer Partnership

Level 3: Customer Alignment

Level 2: Customer Sensitivity

Level 1: Customer Awareness

Guerrilla Marketing Principles

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Guerrilla Marketing Principles

Connect with customers on an emotional level.

Build trust Define a unique selling proposition (USP)

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Unique Selling Proposition

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Guerrilla Marketing Principles

Create an identity for your business through branding.

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

In addition to the text

Guerrilla Marketing Principles

an identity for your business through branding. nEmbrace social networking.

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Guerrilla Marketing Principles

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Guerrilla Marketing Principles

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall

Guerrilla Marketing Principles

Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall